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2016 (3) TMI 165 - CESTAT NEW DELHI (LB)

2016 (3) TMI 165 - CESTAT NEW DELHI (LB) - 2016 (42) S.T.R. 249 (Tri. - LB) - Entitlement of Cenvat credit of service tax - Appellant provided telecom towers, pre-fabricated shelters and parts thereon to telecom service providers for providing passive infrastructure on lease basis and claim for Cenvat credit - Held that: for entitlement of credit on towers, shelters or parts thereof, it is therefore essential that these should be goods and should fall, either within the ambit of capital goods sp .....

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"BSS" (in the case of passive infrastructure providers) or "Telecom Services" (in the case of active infrastructure providers, namely where the telecom companies themselves own the infrastructure used for rendition of telecom services). As these conditions are not fulfilled, appellant is not entitled to Cenvat credit. - Entitlement of Cenvat credit of duty of excise - Appellant provided telecom towers, pre-fabricated shelters and parts thereon to telecom service providers for providing pass .....

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d 2015 (9) TMI 583 - BOMBAY HIGH COURT, and as the the provision of towers and shelters as infrastructure used in the rendition of an output service is common to both passive and active infrastructure providers, whether of "BAS" or "BSS" in one case and "telecom service" in the other, the towers and shelters and parts are decided to be immovable property. Therefore, the appellant is not entitled to Cenvat credit. - Decided against the appellant - Service Tax Appeal Nos. 55227/2013 - INTERIM ORDE .....

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ing issues: a) Whether, Member (Judicial) is correct for holding that post 2006, wherever appellants are paying service tax under the category of "business Auxiliary Services", or "Business Support Services" for providing passive infrastructure, the appellants are entitled to take Cenvat Credit on towers, pre-fabricated shelters parts thereon etc. in the light of the decision of this Tribunal in the case of GTL Infrastructure Ltd. (supra) and Reliance Infratel Ltd. (supra), o .....

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2009, the appellant is entitled to take Cenvat Credit to the tune of ₹ 2,59,95,327/- on shelters/parts as capital goods wherein the supplier has paid Excise duty on these items by classifying under Chapter 85 of the Central Excise Tariff Act, 1985, or; Member (Technical) is correct in holding that in Appeal No.ST/777/2009, the appellant is not entitled to take Cenvat Credit to the tune of ₹ 2,59,95,327/- on shelters/parts as capital goods wherein the supplier has paid Excise duty on .....

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be tagged to be heard by the same Larger Bench. The order dated 30.7.2015 directed that the matters be placed before Hon'ble President for an appropriate decision. 3. When the 21 appeals (13 arising pursuant to the difference of opinion and 8 directed to be tagged along with the 13 appeals) were listed for hearing before the Larger Bench on 3/11/2015, the Respondent/Revenue sought adjournment of the hearing. Hearing of these appeals was therefore adjourned to 8.12.2015. Composition of the La .....

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Sachdev and Manish Gaur for the several appellants; and the learned A.R. Shri Amresh Jain for the respondent/Revenue. 5. At the hearing of the appeals, Shri Amresh Jain, learned A.R. raised preliminary oral objections, on two counts. It is firstly contended that when a difference of opinion is recorded by a Division Bench the same must invariably be referred for resolution of the difference, to a Third Member and cannot be heard by a Larger Bench comprising three Members. Secondly it is contend .....

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e of opinion could be referred to a Larger Bench (and not invariably to a third Member), for resolution. This fact is recorded in para 3 of the order dated 30.7.2015. The only contention that was pressed on behalf of Revenue at that hearing was regarding the necessity of tagging the eight appeals (which are not involved in the difference of opinion) for hearing by a Larger Bench. This aspect also stands considered and answered in paragraph 5 of the order dated 30.7.2015. Further the provisions o .....

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4 (SC) is conclusive on this aspect. The observations of the Supreme Court in para 14 of this judgment being apposite, are reproduced: 14. Consequently, the Division Bench of the High Court with respect was in error when it took the view that a Special Bench can be constituted by the President only pursuant to a judicial order and not in exercise of his administrative powers. It is of course true that in any pending matter before a Bench of two learned members, if it is felt by the learned memb .....

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styled as a reference under Section 255(3) of the Income Tax Act. It was merely a recommendation for invoking the administrative powers of the President under Section 255(3) for constituting Special Bench. It was certainly not a reference under Section 255(3) read with Regulation 98(A). We fail to appreciate how the High Court in exercise of its power under Article 226 of the Constitution could sit in appeal or judgment over the administrative decision of the President who might have felt that t .....

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it may be that the two learned members of the Tribunal might have suggested to the President to place listed four matters before a Special Bench. But being so apprised of the situation if the President felt that the present three matters moved by the concerned three respondents in these proceedings involved the same points and which were required to be thrashed out by a Special Bench we do not see any reason for holding that the constitution of a Special Bench by the President for deciding pres .....

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t competent to constitute a Special Bench. As we have already noted above Special Benches can be constituted by the President both in exercise of his administrative powers under Section 255(1) read with Section 255(3) as also on the basis of a judicial order passed by any Bench of the Tribunal making reference to the President in that connection under Regulation 98(A). But it is not as if that such a reference by the members under Regulation 98(A) by passing a judicial order is the only mode and .....

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demonstrated to be unreasonable, capricious o r mala fide on a given set of facts. But in our view present case was not of that type. There was a conflict of opinion between two Benches of the Tribunal, namely, Madras and Hyderabad Bench. It is, however, true that Madras Bench decision was by a single member while the Hyderabad Bench decision was by a Division Bench. Still it could not be said that there was no conflict of decisions between two Benches of the Tribunal. That itself constituted a .....

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Rajasthan High Court in Mohammad Asgar Mugal vs. Jahuruddin Mugal 2010 (257) ELT 492 (Raj.); and the Gujarat High Court in Suo Motu vs. Gujarat High Court Advocates' Association 2015 (320) ELT 564 (Guj.). In these decisions, the observations and conclusions recorded were in the context of the facts and circumstances and in the specific context arising therein. The binding precedents, of the constitution Bench in Central Board of Dawoodi Bohra Community vs. State of Maharashtra, Union of Indi .....

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Pursuant to the order dated 30.7.2015, the President constituted the Larger Bench on 01.09.2015. The composition was thereafter altered since one of the Members of that Bench was transferred to another Regional Bench before effective hearing could take place. 8. For the aforesaid reasons, we reject the preliminary objections. 9. As already mentioned there are two sets of appeals now considered by this Larger Bench. The first one was consequent upon interim order No. 142-154/2015 dated 28/07/2015 .....

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ellants are entitled to take Cenvat credit on towers, pre-fabricated shelters parts thereon etc. In the light of the decision of the Tribunal in the case of GTL Infrastructure Ltd. (supra) and Reliance Infratel Ltd. (supra), or; Member (Technical) is correct in holding that post 2006, wherever appellants are paying service tax under the category of "Business Auxiliary Services", or "Business Support Services" for providing passive infrastructure, the appellants are not entitl .....

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efore them were not eligible for credit of duty on towers and cabins if they are providing telecommunication service as output service. This conclusion was following the decision of Hon'ble Bombay High Court in Bharti Airtel Ltd. vs. CCE, Pune - III reported in 2014 (35) S.T.R. 865 (Bom.). However, when the appellants are providing output service of 'business auxiliary services' or 'business support services' to the telecommunication companies, such credit of duty on tower pa .....

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and accessories thereof would qualify as capital goods in terms of Rule 2 (a) (A) (iii), whether or not such components, spares and accessories only fall under Chapter 85. The towers and shelters are all components of BTS; (ii) Credit on towers and shelters and other materials cannot be denied on the ground of immovability. As per Rule 3 of Cenvat Credit Rules, credit is admissible on all inputs and capital goods which are received in the premises of service provider. In the present case, tower .....

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s would qualify as 'inputs' themselves. This is made as an alternate submission. Rule 2 (k) (ii) defines inputs as "all goods used for providing output services". There is no bar to indicate that goods which do not fall under the category of capital goods would not also qualify as inputs; (vi) Towers and shelters are to be considered as 'accessories' of capital goods. For an item to fall under the category of 'components', 'spares' and 'accessories&# .....

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nvoices for payment of service tax. There is no loss of identity of goods during the course of erection. 12. The learned Counsels representing the various appellants placed reliance on the decisions of Hon'ble High Courts and Hon'ble Supreme Court in support of their various above assertions. These are examined later in this order. 13. The learned AR appearing on behalf of Revenue submitted that:- (a) the issue relating to eligibility of towers and shelters for Cenvat credit has been cle .....

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annot be said that iron and steel articles are used for providing telecommunication service. It is the immovable tower which is used for providing telecommunication service or business support service; (c) The CBEC vide Circular dated 04/1/2008 clarified that input of credit of service tax can be taken only if the output is a service liable to Service Tax or goods liable to excise duty. Since immovable property is neither service nor goods no credit can be taken. 14. The learned AR also relied o .....

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iary service" to telecommunication companies, which in turn provide telecommunication service. The first issue to address is whether the legal principles and ratio applicable to decide such credit availability will be same for both categories of providers namely those who provide telecommunication service [cellular mobile service companies] and those who provide merely infrastructure support by way of taxable service falling under 'business support service' or business auxiliary ser .....

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capital goods' or 'input services'. These three terms are defined in the Rules and the credit availability is predicated on fulfillment of conditions mentioned therein for goods or services to fall in one of these categories. Credit taken on these goods/services can be used to discharge tax on output services. Credit on Capital Goods:- Rule 2 (a) defines 'capital goods'. It is apparent that capital goods as understood in commercial parlance or industrial circles cannot be aut .....

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ts, spares and accessories of these goods". It is clear that capital goods should fall under the specified tariff classification for eligibility to duty credit. However, there is no such restriction for the components, spares and accessories of such capital goods. 16. The central point of dispute is that the appellants are getting duty paid MS Angles, Channels etc. to the required site and getting them erected into a tower on a concrete foundation. It is the contention of the appellants tha .....

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:- An alternate argument Counsel for the appellant is that towers and pre-fabricated shelters ought to be considered as "Accessories" of overall Base Transmission System (BTS) which is classified under Tariff Heading 8517. Learned Counsel during oral argument and in written submissions, elaborated on this aspect with the support of interpretative Rules for the Tariff and Section Notes. We find that the question whether this alternate argument is legally tenable has already been examine .....

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ll the three terms - "components", "spares" and "accessories" - used in sub-Clause (A) (iii) of clause (a) of Rule 2 should be understood as standing for movables only. It was held by the Larger Bench of this Tribunal in Vandana Global - 2010 (253) E.L.T. 440 (Tri. - LB) that "capital goods" defined under the Cenvat Credit Rules must be excisable goods. Hence, the Hon'ble High Court concluded that the argument of the learned Counsel with reference to t .....

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odara - I reported in 2009 (235) E.L.T. 636 (Tri. - LB) to conclude that tower being admittedly an immovable structure cannot be an accessory of any kind of instrument. 17. Apart from the above ratio, we find that to become an accessory of a capital goods there should identified capital goods. The claim of the appellant is that BTS is a capital goods and the towers and shelters would be it's accessory. We find that no BTS as identified capital goods emerges in the present case. Towers and sh .....

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ent structures and are used for installing/housing the telecom equipment. The question of Immovability of tower and its relevance:- The appellants contended that (a) set of steel items cleared as towers have suffered duty as "towers". (b) even after erection at site on a cement concrete foundation they continue to be goods or in other words do not become immovable property. 18. This aspect regarding the material status of towers and shelters have been examined in detail by the Hon' .....

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y High Court in Bharti Airtel Ltd. (supra). The Hon'ble High Court after elaborate analysis of various relied upon case laws came to the categorical conclusion that towers and parts thereof and shelters are not capital goods and are also not inputs. The Hon'ble High Court observed that towers are immovable structures and ipso facto non-marketable and non-excisable. 19. On the nature of tower being "goods", learned Counsel argued that the Bombay High Court in Bharti Airtel Ltd. .....

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The erection at site and embedding the tower in the concrete platform are only for convenience of easy transport. Learned Counsel contended that whether a product or a thing is movable goods or a immovable property is a question of fact. It is submitted that towers in their case are not immovable property and hence continue to be goods for excise purpose. 20. We find here the Hon'ble Bombay High Court while deciding the admissibility of credit on such towers did not go by the concession or a .....

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ts, nuts are brought and fabricated into an embedded tower. These can be dismantled in to angles and channels, nuts and bolts, substantially restoring to the original condition of the raw material. However, what is transported are "angles and channels". The towers when they are embedded are considered as immovable property. This ratio has, in our considered view, been adopted by the Hon'ble Bombay High Court in Bharti Airtel Ltd. (supra). 21. Learned Counsel relied on the Hon'b .....

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which is fixed by nuts and bolts to a foundation, wherein there is no assimilation of the machinery with a structure permanently and the civil foundation was only necessary to provide a wobble free operation of the machine, the test of permanency would fail. We have carefully perused the Apex court order in this case. The Apex court held that the hot mix plant which is specifically covered under Plant and Machinery Tariff Heading 8474 are manufactured and brought. The point decided by the Apex c .....

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h are otherwise eligible for Cenvat credit which are being denied such credit only applying the test of immovability. Tower Parts (MS Channels, Angles etc.) as "Inputs" for availing credit:- An alternate claim has been made by the appellants to allow Cenvat credit paid on structural parts/towers/ shelters treating them as inputs in terms of Rule 2 (k) (ii) which allows credit of all goods used for providing output services. It was argued that there is no bar for goods which do not fall .....

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ble under input category. We have examined the appellant's plea in the light of decided cases. In the present case, duty paid items are MS Angles and Channels/Shelters which are brought to the site installed/erected and further put to use for mounting/installing telecommunication antenna and other equipment. It is necessary to decide whether duty paid MS angles/shelter are used by infra companies for providing business support service to telecom companies or for providing telecom service by .....

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nput is used for discharging tax on output service. In the present case, the duty paid MS angles, channels etc. are brought to the site, fabricated into towers on a concrete platform. Similarly, the duty paid pre-fabricated shelters are brought and fixed to the ground base firmly. On such towers, the antenna or dish are fixed and connected by cables to electronic equipment housed in the pre-fabricated shelter on the ground. It is apparent that these duty paid items are not used for providing tel .....

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nd installation, fixing of towers and shelters will render such nexus tenuous. If the claim of the appellant is to be accepted, the credit can be even extended to duty paid MS Ingots if procured by the appellants to get the MS Angles manufactured which in turn used for erection of tower which in turn is used for providing telecom service. It is clear that such far remote linkages are not within the scope of the term "used for". 22. Learned Counsel also relied on decision of Hon'ble .....

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was considered by the Supreme Court. It is clear that the Tribunal was considering the scope of terms "wind operated electricity generator, their components and parts thereof". Applying the principle in a Customs case of import of such towers, the Tribunal held the assessee eligible for exemption on such towers as parts. The Tribunal in Customs case Bharat Heavy Electricals Ltd. vs. CC, Chennai reported in 1999 (108) E.L.T. 448 (Tribunal) examined the technical literature of imported .....

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followed for telecom companies to infrastructure companies:- On the above analysis, the first point for difference of opinion referred to this Larger Bench relating to non-applicability of the decision of the Hon'ble Bombay High Court in Bharti Airtel to infrastructure companies to provide business support service to telecom operators can be examined. We find in the normal course the nature of output service should not have any bearing to decide credit eligibility on capital goods now under .....

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i - II reported in 2015 (38) S.T.R. 984 (Tri. - Mumbai). We have perused the GTL Infrastructure Ltd. decision. In the said decision it was mentioned that towers/BTS Cabins were used for providing business auxiliary service and, hence, Cenvat credit cannot be denied. Further, reliance placed by the Original Authority on Explanation II and Rule 2 (k) (i) was found to be incorrect as the same dealt with a manufacturer and not a service provider. The Tribunal was referring to its earlier order in Bh .....

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;ble Bombay High Court order in Bharti Airtel Ltd. (supra) was not available to the Tribunal while deciding GTL Infrastructure Ltd. The tower and BTS Cabin are used for providing output service, here business auxiliary/support service but the question is, is there any duty claimed as credit paid on tower or BTS Cabins as installed at site. These items cannot be considered as inputs as they were held to be immovable property. The inputs which suffered duty like MS angles and pre-fabricated shelte .....

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emselves created such infrastructure and "provided" such business support service to self. The issue of service tax liability in such situation on business support service is not raised because there are no two persons as a provider or recipient of such service. In a sense such service was to the self. Considering such factual matrix, we find that no distinction could be made between the telecom operators and the infrastructure companies in deciding the eligibility of Cenvat credit on .....

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8-HC-AHM-ST and Hon'ble Punjab & Haryana High Court decision in Belsonica Auto Components India P. Ltd. reported in 2015 VIL 300 (P&H - ST). In Sai Sahmita Storages (P) Ltd. (supra), the Hon'ble Andhra Pradesh High Court held that there is no dispute that the assessee used cement and TMT bar for providing storage facility without which storage and warehousing services could not have been provided. The question relating to creation of an immovable asset and the implication of Cenv .....

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to these decisions, it is to be noted that the very same matters covered in the present appeals are discussed elaborately on a similar set of facts by the Hon'ble Bombay High Court in Bharti Airtel Ltd. (supra). When there is a detailed examination and ruling on identical set of facts by the Hon'ble High Court, the same are to be followed. Further, the Hon'ble Bombay High Court reiterated their findings arrived in Bharti Airtel Ltd. (supra) in the case of Vodafone India Ltd. in their .....

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(supra) should be followed. Hence, first point of difference is answered against the appellant and in favour of Revenue. 26. The second point of difference of opinion referred to the Larger Bench is regarding the eligibility of the appellant to the credit on shelters and parts as capital goods. We find that our preceding analysis regarding ineligibility of credit on towers and shelters is equally applicable to the said items. The only reason for claiming the credit on shelters and parts is thei .....

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hereinabove shelters were found to be not eligible for Cenvat credit either as capital goods or as inputs and as such some supplier classifying the product under Chapter 85 by itself does not make them eligible for credit if they are otherwise not entitled for the same. Learned Counsel contended that the denial of credit as held by Hon'ble Bombay High Court is only on classification of these shelters. We find that the Hon'ble High Court categorically held that towers and PFB are in the n .....

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(B. Ravichandran) Technical Member Per: Justice G. Raghuram: I had the benefit of the draft opinion prepared by the Hon'ble Member (Technical) Shri B. Ravichandran, in the batch of thirteen appeals arising pursuant to a difference of opinion recorded in No. I.O./ST/142 to 144/2015-CU (DB) dated 28.07.2015, by a ld. Division Bench of the Tribunal. Eight connected appeals were directed to be tagged to those appeals, for being heard by a larger Bench, by the order dated 30.07.2015. The larger B .....

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onents thereof, for remittance of service tax on the taxable output services provided by appellants. The appellants provide telecom towers and shelters to telecom services providers, on lease basis. Whether appellants are entitled to avail Cenvat credit of excise duty paid on telecom towers, shelters and parts for remittance of service tax on the taxable services of, "Business Auxiliary Service" (BAS) or "Support Services of Business or Commerce" (BSS) as the case may be, to .....

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come immovable property and whether they be treated as components, parts or accessories, credit cannot be availed. 5. In these appeals, ld. Counsel for the several appellants urge that there is a clear distinction between availment of Cenvat credit on towers, shelters and parts by active telecom service providers (as was the case in the rulings of the Bombay High Court in Bharti Airtel Limited and Vodafone India Limited) and the facts in the present batch of appeals, since appellants, herein are .....

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evant, as: All goods falling under Chapters 82, 84, 85 and 90 of the First Schedule to the Excise Tariff Act (rule 2(a)(A)(i)]; and Components, spares and accessories of the goods specified in clause (i) (rule 2(a)(A)(iii)]. "Input" is defined to mean all goods, except light diesel oil etc. used in providing any output service (rule 2(k)(iii)]. Rule 3 of the 2004 rules authorises a provider of taxable service to take credit of specified duties paid on any input or capital goods receive .....

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ld be goods and used for providing an output service. These are conditions precedent for availment of Cenvat credit, on duty paid on these goods, for remittance of service tax on the output services rendered, whether the output service is "BAS" or "BSS" (in the case of passive infrastructure providers) or "Telecom Services" (in the case of active infrastructure providers, namely where the telecom companies themselves own the infrastructure used for rendition of tele .....

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dation plates to concrete foundations. In what circumstances, conditions or factual matrixes plant, equipment or machinery cease to be goods and transmutes to immovable property, we notice a divergence in curial interpretation. 8. In the factual context of towers and shelters owned by active infrastructure service providers, the Mumbai Bench of the Tribunal in Bharti Airtel Limited vs. CST, Pune - 2013 (20) STR 401 (Tri. Mum.) ruled that Cenvat credit could not be availed. This ruling was predic .....

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, Mumbai - 2015 (37) STR 577 (Tri. Mum.); in M/s Reliance Infratel Limited vs. CST, in Service tax Appeal Nos. 88497 and 85682/2014 and in Essar Telecom Infrastructure Limited and Reliance Communication Infrastructure Limited vs. CST, Mumbai-I - 2015-TIOL-1132-CESTAT-MUM. Earlier, in CCE, Mumbai-IV vs. Hutchison Max Telecom Private Limited - 2008 (224) ELT 191 (Bom.), the Hon'ble High Court concluded that towers are immovable property. 9. In State of A.P. vs. BSNL - 2012 (25) STR 321 (A.P.) .....

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telecommunication towers of a height of around 90 mtrs. are embedded either to the earth or to the rooftop of a building and fastening of such huge structures was necessitated, these are excluded from the ambit of "goods "and constitute "immovable property"; and since transfer of the right to use immovable property does not fall within the scope of the VAT Act, there is no liability to tax thereunder. This decision did refer to the decision of the Supreme Court in Solid & .....

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on; and consequently are immovable property but not goods, liable to tax under the A.P. VAT Act. 10. Ld. Counsel for the assessees before us, strenuously contended that decisions, of the A.P. High Court in BSNL, of the Bombay High Court in Bharti Airtel Limited and in Vodafone India Limited have incorrectly appreciated and applied the ratio regarding the character of towers and shelters (as not amounting to immovable property), deducible from the judgment in Solid & Correct Engineering Works .....

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same would not amount to manufacture of "excisable goods" since such plant or machinery need to be permanently embedded in the earth, and are thus immovable property. Whether annextiation of these goods to the earth by fixation on foundations, for ensuring stability of the plant and avoidance of vibration during operations, transform these goods into immovable property and what constitutes immovable property in the circumstances, was therefore the core issue before the Apex Court. To .....

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the touch stone of the provisions referred to above. Section 3 (26) of the General Clauses Act includes within the definition of the term "immovable property" things attached to the earth or permanently fastened to anything attached to the earth. The term "attached to the earth" has not been defined in the General Clauses Act, 1897. Section 3 of the Transfer of Property Act, however, gives the following meaning to the expression "attached to the earth". "(a) ro .....

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embedded for the permanent beneficial enjoyment of that to which it is attached. Attachment of the plant in question with the help of nuts and bolts to a foundation no more than 1½ feet deep intended to provide stability to the working of the plant and prevent vibration/wobble free operation does not qualify for being described as attached to the earth under any one of the three clauses extracted above. That is because attachment of the plant to the foundation is not comparable or synony .....

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d from the foundation. So also the attachment of the plant to the foundation at which it rests does not fall in the third category, for an attachment to fall in that category it must be for permanent beneficial enjoyment of that to which the plant is attached. 20. It is nobody's case that the attachment of the plant to the foundation is meant for permanent beneficial enjoyment of either the foundation or the land in which the same is imbedded. 21. In English law the general rule is that what .....

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1883) 8 App Cas 195 Lord Blackburn speaking for the Court of Appeal observed: "The degree and nature of annexation is an important element for consideration; for where a chattel is so annexed that it cannot be removed without great damage to the land, it affords a strong ground for thinking that it was intended to be annexed in perpetuity to the land." 22. The English law attaches greater importance to the object of annexation which is determined by the circumstances of each case. One .....

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s where machinery installed by monthly tenant was held to be moveable property as in cases where the lease itself contemplated the removal of the machinery by the tenant at the end of the tenancy. The mode of annexation has been similarly given considerable significance by the courts in this country in order to be treated as fixture. Attachment to the earth must be as defined in Section 3 of the Transfer of Property Act. For instance a hut is an immovable property, even if it is sold with the op .....

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be easily removed, was not treated to be a part of structure or the soil beneath it, as the attachment was not for more beneficial enjoyment of either the soil or concrete. Attachment in order to qualify the expression attached to the earth, must be for the beneficial attachment of that to which it is attached. Doors, windows and shutters of a house are attached to the house, which is imbedded in the earth. They are attached to the house which is imbedded in the earth for the beneficial enjoyme .....

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are not per se immovable property. (ii) Such plants cannot be said to be "attached to the earth" within the meaning of that expression as defined in Section 3 of the Transfer of Property Act. (iii) The fixing of the plants to a foundation is meant only to give stability to the plant and keep its operation vibration free. (iv) The setting up of the plant itself is not intended to be permanent at a given place. The plant can be moved and is indeed moved after the road construction or re .....

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The argument advanced on behalf of the assessee was that since the machine was embedded in a concrete base the same was immovable property even when the embedding was meant only to provide a wobble free operation of the machine. Repelling that contention this Court held that just because the machine was attached to earth for a more efficient working and operation the same did not per se become immovable property. The Court observed: "5 Apart from this finding of fact made by the Tribunal, t .....

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ether the paper-making machine can be sold in the market. The Tribunal has found as a fact that it can be sold. In view of that finding, we are unable to uphold the contention of the appellant that the machine must be treated as a part of the immovable property of the company. Just because a plant and machinery are fixed in the earth for better functioning, it does not automatically become an immovable property." 27. In M/s. Narne Tulaman Manufacturers Pvt. Ltd. Hyderabad (1989 (1) SCC 172) .....

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imself manufacturing only one part of the component used in the erection of a weighbridge did not mean that the complete machine once the same was assembled by using duty paid parts was not excisable to excise duty. 28. In Triveni Engineering's case (supra), the question that fell for consideration was whether a turbo alternator comprising two components (i) steam turbine and (ii) complete alternator and fixing the same on a platform brought about a new dutiable product. The Court held that .....

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he factum of fastening has to be ascertained from the facts and circumstances of each case. The following passage is apposite in this regard: "There can be no doubt that if an article is an immovable property, it cannot be termed as "excisable goods" for purposes of the Act. From a combined reading of the definition of "immovable property" in Section 3 of the Transfer of Property Act, Section 3 (25) of the General Clauses Act, it is evident that in an immovable property .....

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ection 3 (26) of the General Clauses Act nor was there any intention of permanently fastening the same to anything attached to the earth. 30. Reliance was placed by Mr. Bagaria upon the decision of this Court in Quality Steel Tubes (P) Ltd. Vs. CCE, U.P. - 1995 (75) E.L.T. 17 (S.C) and Mittal Engineering Works (P) ltd. v. CCE, Meerut - 1996 (88) E.L.T. 622 (S.C.). In Quality Steel Tubes case (supra) this Court was examining whether 'the tube mill and welding head' erected and installed b .....

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any comparison between the erection and installation of a tube mill which involved a comprehensive process of installing slitting line, tube rolling plant, welding plant, testing equipment and galvanizing etc., referred to in the decision of this Court with the setting up of a hot mix plant as in this case. As observed by this Court in Triveni Engineering & Industries case (supra), the facts and circumstances of each case shall have to be examined for determining not only the factum of fast .....

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embled at site with bottom plates, tank coils, drive frames, supports, plates, distance places, cutters, cutter supports, tank ribs, distance plate angles, water tanks, coils, extension pipes, loose bend angles, coil supports, railing stands, intermediate platforms, drive frame railing and flats, oil trough, worm wheels, shafts, housing, stirrer arms and support channels, pipes, floats, heaters, ladders, platforms, etc. The Court noted that the mono vertical crystallisers have to be assembled, e .....

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hed by foundation to the earth and, therefore, were not, in any event marketable as they were. This decision also, in our opinion, does not lend any support to the case of assessee in these appeals as we are not dealing with the case of a machine like mono vertical crystallisers which is permanently embedded in the structure of a sugar factory as was the position in the Mittal Engineering Works case (supra). The plants with which we are dealing are entirely over ground and are not assimilated in .....

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ame was immovable property which could not be shifted without dismantling the same. 33. It is noteworthy that in none of the cases relied upon by the assessee referred to above was there any element of installation of the machine for a given period of time as is the position in the instant case. The machines in question were by their very nature intended to be fixed permanently to the structures which were embedded in the earth. The structures were also custom made for the fixing of such machine .....

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able character of the machine becomes extinct. The same cannot thereafter be treated as moveable so as to be dutiable under the Excise Act. But cases in which there is no assimilation of the machine with the structure permanently, would stand on a different footing. In the instant case all that has been said by the assessee is that the machine is fixed by nuts and bolts to a foundation not because the intention was to permanently attach it to the earth but because a foundation was necessary to p .....

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ontend before us that in the facts before us, as in the case of Solid and Correct Engineering Works there is no permanent affixation of towers and the pre-fabricated shelters to the earth, permanently. These are fixed to foundations by nuts and bolts, not with the intention to permanently attach them to the earth or for the beneficial enjoyment thereof, but only since securing these to a foundation is necessary to provide stability and wobble/vibration free operation and to ensure stability. Sin .....

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process employed for their erection at a site; the degree of permanency that results from their attachment to the site by bolting them on to concrete foundations; whether the intendment in so embedding these to the site, is for permanent and beneficial enjoyment of the earth and other relevant and cognate fact specific aspects, by applying the nuanced tests of immovability expounded in Solid & Correct Engineering Works, may perhaps lead to a different conclusion then the one emerging from t .....

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ration, when and if challenged, by the Hon'ble Supreme Court. It is outside the province and jurisdiction of this Tribunal to analyse and record a ruling on a superior Court's analyses and elucidation of other binding precedents. The A. P. High Court's judgment in BSNL, in the context of levy of VAT, concluded that towers are immovable property, after noticing and adverting to the judgment in Solid & Correct Engineering Works. Though, the Solid & Concrete Engineering Works ru .....

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ion in Bharti Airtel Limited on a premise that its earlier decision might have been incongruous with the ratio of the Apex Court's decision in Solid & Correct Engineering Works, it is clearly beyond the province of this Tribunal to embark upon such an exercise, on any grounds, including the per-incuriam principle. 15. On the above analyses, we conclude that the Hon'ble Bombay High Court judgments in Bharti Airtel Limited and Vodafone India Limited, which are directly on the issue of .....

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